Tax Hikes on the Wealthy Alone Can’t Pay for ‘Medicare for All’. Over thirty two trillion dollars is a lot of money so soak the rich. That’s the analyst estimate of the 10-year cost of Bernie Sanders’ “Medicare for All” plan. The two dozen, or so, Democrat presidential hopefuls are all either on the Bernie train or have proposed myriad equivalent plans. To pay for those programs, the candidates claim they will soak the rich.
If wishes were horses beggers would ride.
But that’s not going to work for two primary reasons. First, the rich don’t have the total number of dollars needed to pay the bill. And that means even if all income we confiscate all of their income we still don’t get there. And second if you institute confiscatory taxes they will vote with their feet. That’s right they are not stupid enough to stand still and let the government confiscate all their wealth. They will leave.
Who is going to pay?
What that means for an average American is that you and I are going to have to pay the bill. Raising the more than $30 trillion to fund Sanders’s health plan requires doubling all personal and corporate income taxes. Are you still hungry for bureaucrat run healthcare for all? Look how well public education is working. Costs are going up and usable output is going down. Great trends… just great.
If you don’t like that payment option another way we can go is to triple payroll taxes. Doing that zaps both the average working American and their employer. Now maybe tripling the withholding taxes won’t affect your budget but it will make a big difference for most people. Worse than that effect is adding that much additional tax to the average employer payroll will mean layoffs. It is simple as that. So the effect will be bad plus bad.
Fool me once
Advocates of these proposals promise that total government control over American health care will secure higher quality care at lower cost. That’s simply male bovine excrement. So they want to soak the rich, they think you will believe we should attack those we envy. We saw this game with Obamacare. Lies, lies, lies and more lies; fool me once, shame on you. Fool me twice, shame on me.
Things in Medicare for All
The proposals analyzed outlaw virtually all private and employer-sponsored health plans now covering 181 million Americans. Millions of federal workers and their families who get their coverage today through the popular and successful Federal Health Benefits Program (FEHBP) would also lose it.
Medicare for All would eliminate, the Medicare, Medicare Advantage and Medicare supplemental insurance programs now covering over 58 million senior and disabled Americans. Medicaid and Children’s Health Insurance programs covering over 73 million more would disappear, too.
What do the numbers tell us?
It is arithmetically impossible to pay for progressive promises by “taxing the rich.” Progressive promises are just too expensive. Worse yet the amount of income earned by the rich is too small. Even using lower cost estimates of their proposals, confiscating every dollar earned by every taxpayer with incomes of $200,000 or more would only pay for about half of the progressive agenda.
That figure is based on the very false assumption that people would continue to work, save, and invest when subject to a 100% flat tax. Guess what, the reality is, progressive promises can only be funded by increasing taxes on the middle class. How much you ask? Well the spread is pretty wide but it will increase taxes from three to 10 times their current level.
Now if you say we can just borrow/print more money hold on. That might work for a limited time. It would require dramatic and unsustainable increases in federal borrowing. Here’s what we know:
- Confiscating every dollar earned by taxpayers with incomes over $200,000 would not come close to paying for the left’s agenda.
- Progressive policies would require either increasing middle-class taxes to three to 10 times existing levels or radically higher, unsustainable federal borrowing.
- Progressive promises would increase federal taxes and spending to levels higher than other advanced countries. That would have a dramatic adverse impact on the economy.
Sanders has backed the concept for years, and when he proposed similar legislation in 2013 it attracted no co-sponsors. But when he offered his Medicare for All legislation in April, 14 other Democratic senators signed on, including Kamala Harris, Cory Booker, Kirsten Gillibrand and Elizabeth Warren, four of his rivals for the Democratic nomination.
